Revealed: Labour's plan to wipe student debt

Andrew Little has let slip a major policy initiative that would see a Labour government writing off student loan debt.

The Labour leader has revealed it is considering wiping existing student debt for those who take public service jobs in the regions.

"I don't have any particular promise to make. We're looking at ways that we can assist students to effectively write off at least a part of that student debt, through things like taking a public service job somewhere outside of one of the main centres and for the length of period that you're there let's look at a write-off sort of regime."

Mr Little made the comment when asked about student debt during an interview on Victoria University student radio station Salient FM on Tuesday.

Labour has already released a major multibillion-dollar education policy of three years' free tertiary education if it is elected next year.

Mr Little told the radio station Labour would have "more to say in a couple of education policies, including one of at the tertiary end that will effect students".

"One of the issues that's come up since our three free years post-school education training is 'well, what about those students who've got debt already?'," Mr Little said.

The policy linking reducing student debt and helping the regions is a likely push for Labour which is focused on both areas.

Official figures show there is a total of $15 billion of student debt and about 720,000 New Zealanders have a student loan of some form.

Mr Little told Newshub the policy was still being worked through, but said the jobs being looked at were roles that are hard to recruit for in the regions like science teachers.

He said it would work in a similar way to the Government's scheme which sees health graduates move to regions in return for annual payments to help repay their student loan.

And he didn't rule out extending the policy to the private sector.

Mr Little told RadioLIVE the details of the policy would be finalised before the next election.

"The specific numbers are going to depend on what we think we can afford, and that's going to depend on a range of other commitments that we're prepared to make."

He says the policy is aimed at addressing both the issue of rising student debt and difficulties recruiting graduates into either the regions or areas that are difficult to recruit into because of the level of incomes.

"We know that it's affecting life choices about when to start a family and buy a home," says Mr Little.

Green Party co-leader Metiria Turei says her party already had a policy to wiping student debt through things like bonding so was "great" Labour was thinking along the same lines.

But Tertiary Education Minister Steven Joyce says whatever conditions the policy might end up having will "pretty quickly" add up to billions of dollars.

"I don't think he knows what to do from what I can see, but if he is talking about wiping off student loan debt that is a very big cost to taxpayers.